If P^e Is the Expectation of an Asset's Price Forecast

question 58

Multiple Choice

If P^e is the expectation of an asset's price forecast and P^f is the optimal forecast of the asset's price, then if market participants have rational expectations

• A)P^e > P^f.
• B)P^e < P^f.
• C)P^e = P^f.
• D)There is no necessary relationship between P^e and P^f.

---

Definitions:

Positive Message

A communication that conveys good news, positive feedback, or an affirmative outcome.

Self-Congratulatory

The act of praising oneself for one's achievements or qualities, often perceived as boasting.

Goodwill Messages

Communications that express thanks, offer congratulations, or show appreciation to build or maintain positive relationships between individuals or organizations.

Personal Tone

The use of style in communication that feels individualized and tailored, often involving a more direct or intimate approach to connect with the audience.